WASHINGTON (AP) -- The Federal Reserve reports how much consumers borrowed in October. The report will be released at 3 p.m. EST Friday.
BORROWING MORE: The forecast is that consumer borrowing rose $13.9 billion in October compared with September when borrowing had increased $13.7 billion.
STEADY GAINS: Borrowing has been rising steadily, setting records. But the increases have been coming in auto loans and student loans. Consumers have been reluctant to use their credit cards. Credit card debt has fallen for four straight months through September.
DRAG ON GROWTH: The string of declines in credit card debt will likely hold back consumer spending, which accounts for 70 percent of economic growth.
Through September, the measure of auto loans and student loans has risen 8.5 percent from a year ago and has increased in every month but one since May 2010. But credit card debt is essentially where it was a year ago. And it is 17.2 percent below its peak hit in July 2008 — seven months after the Great Recession began.
Slow job growth and small wage gains have made many Americans more reluctant to charge goods and services.
But at the same time, the weak economy is persuading more people to go back to school to learn new skills. The Federal Reserve Bank of New York quarterly report on consumer credit shows student loan debt has been the biggest driver of borrowing since the Great Recession officially ended in June 2009.
Analysts are hoping that consumers will step up spending and help drive faster economic growth. The overall economy grew at an annual rate of 3.6 percent in the July-September period, according to a revised estimate released Thursday, up from growth of 2.5 percent in the April-June period.
However, about half of the third quarter growth came from a huge increase in the buildup of business stockpiles. That is not is expected to last and slower inventory building is likely to contribute to weaker economic growth of less than 2 percent in the current October-December quarter.
The Fed's borrowing report tracks credit card debt, auto loans and student loans but not mortgages, home equity loans and other loans.
- The Federal Reserve
- Credit card debt